Holding meetings on national holiday Is it a boon or bane?
The Companies Act 2013 has opened ponder box to many critical issues. One such is the “national holiday” concept which is a constitutional mandate, creating ambiguity on conduct of meetings on National Holidays.
‘National Holiday’ - concept though is meant for performing national duties like paying a part of tribute to the motherland and respect to the martyrs of freedom struggle, however, public treat it as just another common holiday.
Adding to this, New Companies Act has paved way for conducting / not conducting meetings on such national holidays.
The Companies Act 2013 has opened ponder box to many critical issues. One such is the “national holiday” concept which is a constitutional mandate, creating ambiguity on conduct of meetings on National Holidays
The two questions that arise from the said Act are:
(i) Who has the authority (appropriate government) to declare national holidays? Can the National Holiday differ from State to State?
(ii) Which Board Meetings and General Meetings are allowed on national holiday and which are not allowed? That is scheduled (original) meetings or adjourned meetings or otherwise?
Who is empowered to declare national holiday? Can the national holiday differ from State to State?
The term national holiday has it’s cite in Section 96 of Companies Act, 2013: “National holiday means and includes a day declared as national holiday by the Central Government.” The Central Government is empowered to declare, 26th January (Republic day), 15th August (Independence day) and 2nd October (Mahatma Gandhi Jayanthi) as national holidays which is applicable to whole of India including the State of Jammu and Kashmir. The perplexity is whether 1st May is also National Holiday?
National holidays Act has given power to the State Government to declare national holidays which are applicable within the state. Which Board Meetings and General Meetings are allowed on national holiday?
The detailed analysis of the chart is here under: As per Companies Act, 2013 the Original General Meeting cannot be held on national holiday. Surprisingly, the Adjourned General Meeting can be held on national holiday. Furthermore, adjourned Board meeting cannot be held on national holiday. Now the unsurpassed issue is conducting Board Meeting on national holiday.
If the Board Meeting is allowed to be conducted on national holiday all the employees or Directors or other connected people related to Board Meeting shall be present, which is nothing but violation of labor laws and Shops and Establishment act. By allowing Board meeting on day of prominence as mentioned in the beginning will take away the right of the citizen by legislation which is against public interest and Constitutional spirit. In the light of the above, it can be concluded that the law is silent on the original Board Meeting. At this juncture, Ministry of Corporate Affairs has to come out with clarity by taking into confidence the Industry, Investor and public and based on the spirit of national holiday by clarifying whether national holiday declared by State is a day for meetings or not.
By: CS Ahalada Rao V
